(a) The following provisions are hereby included in the certificate of incorporation of every domestic corporation, heretofore or hereafter formed, to which this chapter applies in whole or in part, and which is a “private foundation” as defined in section 509 of the United States internal revenue code of 1954 (“code”): 1
(1) The corporation shall distribute such amounts for each taxable year at such time and in such manner as not to subject the corporation to tax on undistributed income under section 4942 of the code. 2
(2) The corporation shall not engage in any act or self-dealing which is subject to tax under section 4941 of the code. 3
(3) The corporation shall not retain any excess business holdings which are subject to tax under section 4943 of the code. 4
(4) The corporation shall not make any investments in such manner as to subject the corporation to tax under section 4944 of the code. 5
(5) The corporation shall not make any taxable expenditures which are subject to tax under section 4945 of the code. 6
Except as provided in paragraph (b), this paragraph applies notwithstanding any other provision of the certificate of incorporation or any direction in a gift instrument.
(b) Paragraph (a) shall not apply to the extent that it conflicts with any mandatory direction in a gift instrument executed prior to the effective date of this section unless such conflicting direction is removed as impracticable under article eight of the estates, powers and trusts law or in any other manner provided by law. The absence of a specific provision in the gift instrument for the current use of the principal of the fund, or the presence in such an instrument of a provision, as to the principal of a fund, limited to the principal's being held, invested and reinvested, is not such a conflicting mandatory direction.
(b-1) A domestic, not-for-profit corporation that is a “private foundation” as defined in section 509 of the code and that is required by section 6104(d) of the code 7 to make available for public inspection its annual return shall publish notice of the availability of such return for inspection. Such notice shall be published, not later than the day prescribed for filing such annual return (determined with regard to any extension of time for filing), in a newspaper designated by the clerk of the county in which the principal office of the private foundation is located, having general circulation in that county. When such county is located within a city with a population of one million or more, such designation shall be as though such notice were a notice of judicial proceedings. The notice shall state that the annual return of the private foundation is available at its principal office for inspection during regular business hours by any citizen who requests it within one hundred eighty days after the date of such publication, and shall state the address and the telephone number of the private foundation's principal office and the name of its principal manager. A copy or notice published in a newspaper other than the newspaper or newspapers designated by the county clerk shall not be deemed to be one of the publications required by this paragraph.
(c) All references in this section to sections of the code shall be to such sections as amended from time to time, or to corresponding provisions of subsequent internal revenue laws.
(d) Nothing in this section shall impair the rights and powers of the courts or the attorney-general of this state.
(e) For purposes of this section, the term gift instrument shall have the meaning set forth in section 551 (Definitions).
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